Disabled, SSDI, limited income. Is modification an option?

I found this forum a few months ago, I've learned a lot from reading the Chase and NACA bulletin boards, but have not posted much. I hope you can offer some words of wisdom and advice.

I have been unable to work since 2004. I am dealing with a dibilitating and relatively rare complication from surgery, as well as a long-term chronic illness. While trying to regain my health, I have fought one battle after another for proper treatment, medical insurance coverage, and disability insurance wrongful denials, appeals, and lawsuit.

Side-bar: Social Security Administration approved my claim for disability benefits fairly quickly, while my disability insurance carrier cancelled my benefits. How can they cancel my benefits? Social Security supposedly has stricter requirements than the disability insurance company, but the companies that provide group disability insurance are protected under federal ERISA laws. These laws allow insurers to wrongly deny and cancel benefits with no consequences. It happens to thousands of people every year.

I refinanced my condo in 2007 and took out equity to cover medical bills and living expenses. No income verification required, based solely on my excellent credit rating. Interest only, fixed interest rate of 7.75% for 7 years then it would adjust. The monthly payment (interest and taxes) is $2500 a month. I hoped it would buy me some time to recuperate and return to work, however things didnâ€™t work out that way and I am still unable to work. I realize now that the refi was probably not the best idea, but I was very sick and in really bad shape at the time and it kept me in my home, my sanctuary. <O></O>
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My sole source of income is from SSDI $1506. Over $1000 a month goes to health insurance and medical expenses even with Medicare. Then I have credit cards, student loan debt, HOA fees, property insurance, auto insurance and expenses, utilities, food and so onâ€¦ totaling roughly $1800 per month. Add in the mortgage and I have a deficit of about $3800 each month. It didnâ€™t take long to go through the equity I took out in the refi. Now I am going through what I have left from a 50 cents- on- the-dollar Net Present Value, attorney-gets- 40% -plus-admin-costs disability insurance settlement. I harbor no resentment toward my attorney; ERISA laws make it nearly impossible to fight and win on your own.
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I started investigating loan modification and other options last fall. I attended a NACA event in Sept 2009, but their help hasnâ€™t gotten me very far. I stopped paying my mortgage in April 2010 after I read this board and elsewhere that my lender Chase (Freddie Mac investor) was unlikely to help me if my mortgage was current. Also, at the rate I was going, my savings would only last about 15 more months.
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I now find myself in a very difficult place. Iâ€™ve mapped out many scenarios trying to figure out how to make what I have last as long as possible and maybe keep my home. But there are many unknowns: Is loan modification even possible? Will I be able to return to work? I may an eternal optimist, in denial, or just plain dense, but I still hold out hope that I will be able to work again.<O></O>
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Iâ€™ve submitted paperwork to Chase and follow up weekly, but keep getting told that my application is under review or that they need updated info. I got a letter from Chase a few days ago about a Homeowner Assistance Event July 16-20 in ffice:smarttags" /><ST1lace>lace> near where I live. The letter says they still need a hardship affidavit from me. I am thinking of attending the event to turn in the hardship affidavit and any other info that might be needed. Maybe Iâ€™ll get a better idea of what options are available to me.
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I am â€œworkingâ€ as hard as I can to try to regain my health and vitality. However after 6 years of battling for proper treatment, medical insurance coverage, and disability insurance wrongful denials, appeals and lawsuit, I am pretty spent. I would appreciate any info you have for me.
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Thanks,
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Plantgeek
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P.S.â€”Questions: If my house were to foreclose, would the fact that I refied and took money out affect whether the lender has recourse to come after me? I know CA is a non-recourse state, but does that change with the refi?

I provided both NACA and Chase copies of my Wells Fargo bank statements and ING savings account. Is there any way that Chase can get that money?

The one thing I see right off is you should apply for deferment on your student loan based on disability. Also in my state someone who is permanently disabled gets a property tax rebate based on need and with your $1500.00 ssdi monthly income you should qualify for both these programs. I would plan your life and finances around that income. If you win a law suit later, great but if you don't at least you have a financial plan. Work on getting your first mortgage modified. What do you owe on your first? I would go to the event you mentioned if you can and also get as much imfo as you can from this forum. I wish you the best and post back if you have more questions.

CA. is non-recourse only on purchase money loans. When you refied you lost your purchase money loan (the actual loan you purchased the home with) however, CA. has initiated a lot of new laws regarding forclosure and the deficient balance. CA. can do Judicial Foreclosures (where you are responsible for the deficit) however the lenders rarely do them. You may want to research some of the new foreclosure laws on the State's website to find out which work for you. I to received the letter from Chase regarding the Homesave event they are having July 16-20 but I called the Homesave Center in Santa Ana and made an appointment to go in next week and sit with a counselor so we'll see what happens! Best of luck to you!

I tried to schedule an appointment at the Homesave Center in Santa Ana a couple months ago but they told me that I couldn't because my loan was now in default. It seemed sort of weird at the time, but I never thought about it to check again. I think I'll give them a call in the morning to see if I can make an appointment there; I would rather not have to wait to speak to someone at the event or feel rushed because others are waiting.

I've been filling out the hardship affidavit for Chase. Originally I planned to just type out the hardship letter I had scrawled across several pages while waiting at the NACA event. However after looking at some sample hardship letters, I think I put too much emphasis on my story that reads like a series of unfortunate events and not enough focus on how a loan modification will be a win-win. I'm having difficulty addressing the unknown of whether or not I'll be able to return to work-- how will I be able to meet the long-term commitment? Hmmm.....

I'll read through some more of the sample hardship letters to see if anyone has been in a similar position. In the meantime, thoughts, ideas, suggestions are welcome!

I'm in another state, but I'm trying to sell to avoid foreclosure. (emminent danger of default)

wow, I don't understand how you are affording that price of home. I understand your situation. I purchased my home before I got seriously ill.

Homeownership is swallowing me up. SSDI can't keep up with the 'overhead', medical, car, and home maintenance so I'm also trying to see what help is available to sell. Even if I have to take short sale in this souring real estate market.

My agent is worried the bank will not accept request for short sale... but when I spoke to the bank, they said bring a true and complete offer and we see what options there are. Probably could even go thru the HAMP program. The only problem may be the broker evaluation. (BPO?)

I had my condo on market during time of 2010 homebuyer credit... but no sale...(went inactive to zero out DOM on MLS per recommendation of the real estate experts) now back on market - currently listed 10k less than that LAST LOWEST asking price! Oh boy! I can't believe these realtors want you to make updates to sell AND lower your asking price! Geesh if I'm struggle to make the maintenance bills, where to do I get the monies for elective updates??! I could only paint some walls on my own, which hindside seems like it didn't matter anyways. We are now listed below 60k!!!

Even with the property tax credit, I'm struggling to make ends meet.

The big maintenance hit to me was a need for replacement of 20+yr old HVAC (on a loan). I feel my agent is pushing me into payment default because I can't get her to even bring me investors to TRY a shortsale!!!

I see someone mentioned changes in foreclosure laws... that gives me an idea of some more research for myself. NO offer/contract.... is well, NO SALE! (why doesn't the realty agent see it that way??)
I really want out my condo before more breaksdown.

It's too costly for me, and wayyyyy too stressful for me to make those decisions. (I don't have boyfriend or roommate to help with costs/repairs and frankly don't know who would put up with mania episodes. Makes me miss my daddy! -- THANKS DAD, for all you have done for me in life! tear sniff)

hi, me again, back from more research -- can you tell I'm lacking sleep over my life situation?!

I'm rereading your post. My brain takes more than a few tries to comprehend things. Ughhh! I want my brain back! If I read correctly, you have stopped payment on your home loan several months ago.
Has the lender sent you threats or foreclosure notice??

Has anything hit your credit score? Wondering how much it will impact your score.

I can't say that I'm affording my home at this point since I have to take money from savings every month to make ends meet. I stopped paying my mortgage in April and, as of June, took a nearly 200 point hit to my credit score. I haven't checked my score since then but figure it's probably gone down even more because I'm more than 120 days late.

I received an "acceleration warning" at the end of May. I've received a few collection related letters in the last couple months and letters norifying me about Chase Homeowner Assistance Events/ Foreclosure Prevention Workshop. I check my county clerk recorders on-line records for notice of default filing a few times a week.

Here's an update since my last post:

I did not attend the Chase event in my area; medical issues make it difficult to drive the distance and then have to wait around. I was concerned that I wouldn't be in any kind of shape to meet with someone and have an intelligent conversation. I arranged an appointment at Chase's homeowner assistance center. The person I met with wasn't a counselor by any stretch of the imagination. He just scanned in the documents I brought in and submitted them to Chase. He answered a few questions I had about the modification process and that was it. However, I do think the appointment was worthwhile since both someone at Chase and I know that I submitted and they received all the documents.

I've been calling a few times every week to check on the status of my modification request. Found out last week that I had been denied for one of the government programs due to having a defict each month (not enough income/ too many expenses). They are reviewing my application for an in-house mod.

About my question: Is modification an option? According to the screening questions on the Making Home affordable site, I am eligible. My question is whether there is any way to structure the mod to make it affordable for me. Can they consider my income to be what I receive from SSDI plus some amount that I take from savings every month? I don't really have any ways to increase my income. I could possibly get a roommate, but I don't want to have someone move in only to tell them in a few months that they have to move out because I'm losing my house. It just doesn't seem right to put someone through that.

I'm looking for ways to reduce expenses: I contacted my student loan lender and was approved for deferment for at least a year; I can apply annually and defer up to three years. CA's property tax assistance only applies to disabled veterans, so I'm not eligible for that. Thank's, Redroad, for the suggestions.

In addition, I contacted a non-profit group that I receive medication co-pay assistance from (one medication costs over $5000 per year). They cover up to $4000 per year. I've received assistance for the last 2 years, which is generally their limit, but they can extend for another year in some hardship situations. I sent in my application last week and I'm hoping they will approve it. I'm also investigating other similar organizations just in case...

Current questions:

1.) Should I go ahead and let Chase know about the deferment? Seems like I should, but are there any reasons to wait until they give me an answer on the in-house mod?

2.) Does anyone know what happened to KEVINNJ? His latest thread was "47 payments behind and finally got mod papers today...". He last posted in May with questions about suspense accounts. I can't find his thread or even his member name using this sites search features. He seems to have disappeared. I hope it's because his mod is final and he's moved on.

ohhh this credit score stuff doesn't good sound to me! I worked so hard to get a good score.

I'm not deliquent yet, but I think something has to give this month. My agent 'thinks' she is looking in my best interest, but I'm not feeling the warm fuzzy vibe. Her plan MAY work but I needs a written offer!
I think my realty agent is in denial that we will have a buyer anytime soon! LOL I know I'm sitting on a 40+yr property with original stove and oven along with HIGH condo fee. There is some NICE competition for anyone wants to get a GREAT deal on home these days. They can walk right past mine if they don't see the potential.

Something she said to me last week makes me believe she not bringing in 'known' investors. I AM FURIOUS. Why would someone hold back a buyer of any kind is beyond me!

Anyways, my state has 2 different property tax credits. I qualified for one and not other.
What is your definition of savings? (IRA, standard saving, 401k, etc?) The forms should have had the 'fill in' parts for the different categories. Otherwise they will be coming back to you for more information.
As far as the deferment - this is great news for you. It may not matter if you tell them right now. I would think that when your file comes up inline (ie a real person is assigned to looking it over) you will get more questions coming and can discuss that with them at that point. I sure would hate it if my 'file' was the 3rd position in the 'to-process-stack' and someone pulling it out over a phone call would place it at XXX position whenreturned to the pile.

sorry for any spelling errors... my brain is batter dipped and fried about now.

I have a medigap policy and it's not cheap. However it just about pays for itself when I do the math to determine what I would have spent for medical care without it. Only Medicare part A is available at no cost. I still have to pay for Medicare part B and part D/ drug plan. Medicare Drug plans have the ridiculous "coverage donut hole" which I reach in the first few months of the year. In the donut hole I pay up to $1600 for a months worth of one medication. I've looked into Medicare advantage plans-- HMOs that supposedly cover everything-- but they really are not a good choice for me because I need flexibility to choose my doctors.

Perhaps I read your post incorrectly. Are you saying that CA has a program where medigap policies are available at no cost? I'd love to know more about it. Please let me know so I can do further research.

Person to person,

I can imagine how frustrating it would be to have a realtor who seems to be working against you rather than for you. Perhaps it's time to look for someone else?

It's a standard savings account and CD that I'm referring to. I got the forms from Chase's website and they are the standard forms used on other sites as well. I filled in the appropriate places on the form. I didn't include the withdrawal from savings because it really isn't income, plus there wasn't a category to include it on the form. I did, however, explain in my hardship letter/ additional info that I used savings to cover bills. I thought it made sense to do it that way when I filled out the form, but now I'm wondering if I should have included it under "other income".

"I have a medigap policy and it's not cheap. However it just about pays for itself when I do the math to determine what I would have spent for medical care without it. Only Medicare part A is available at no cost. I still have to pay for Medicare part B and part D/ drug plan. Medicare Drug plans have the ridiculous "coverage donut hole" which I reach in the first few months of the year. In the donut hole I pay up to $1600 for a months worth of one medication. I've looked into Medicare advantage plans-- HMOs that supposedly cover everything-- but they really are not a good choice for me because I need flexibility to choose my doctors."
---> I thought Part B now included medications?I didn't think I qualified for medigap, but sure could use some eye and dental coverage so I'll look into what it is.Person to person,

I can imagine how frustrating it would be to have a realtor who seems to be working against you rather than for you. Perhaps it's time to look for someone else? -----> she doesn't understand there is more than one reason for my move! I not only have my finance issues, and myown health issue, I also have an ill parent I want to get closer to so I can help out more. She just doesn't get it. It's a standard savings account and CD that I'm referring to. I got the forms from Chase's website and they are the standard forms used on other sites as well. I filled in the appropriate places on the form. I didn't include the withdrawal from savings because it really isn't income, plus there wasn't a category to include it on the form. I did, however, explain in my hardship letter/ additional info that I used savings to cover bills. I thought it made sense to do it that way when I filled out the form, but now I'm wondering if I should have included it under "other income".

-----> this part doesn't sound positive to me. The bank will definitely be inspecting my savings account too. (which is about totally depleted!) This may be the last month for this..... and my agent is wondering why I'm having a cow! Ummmm DUH!?!

Plantgeek, looking at the numbers, your income, and loan amount, and assuming about $300 a month for tax/ins/hoa, I don't see any way that you would qualify for any program. HAMP bases it on a straight 31% of income, less than $500 for you. After tax/ins that only leaves $200 a month of your allowed payment to go toward principal and interest. That is only a $65k mortgage balance, so they would have to forgive way more than the program allows them to forgive. Even if the whole $500 went toward principal and interest, it would still not be enough.

I want to make a suggestion. First thing you need to do is declare BK. Get the delay for your student loan, use your savings to put down on a rental deposit, and first/last month with a more affordable payment, look into housing assistance, and food stamps, utility assistance, and everything else. You do not want to waste any more of your savings on an long term unsustainable housing expense. Unless you can imagine somehow having a higher future income, you should not be spending your savings on something you know you are going to lose sooner or later. I think that you are a candidate for just not paying your mtg at all, and stay as long as you can until they knock down your door.

I don't think you should put another dime into that place. Start preparing to move. If you are current now, you might be able to stall for another year or so. Paying an atty for guidance will be a better use of your funds than paying your mtg. I know there is a lot of assistance out there for disabled.

If you inform the bank of any of your savings, they will come after it. It is better to tell them nothing. I really do not think that you will ever get an affordable mod. There are however plenty of rental assistance resources for disabled people.

You can be eligible for the mod program, but your finances don't fit into the formula.

Best Regards,

Moe
Founder
LoanSafe.org - America's #1 Mortgage Forum
1-800-779-4547

DISCLAIMER: The comments by me and the materials available at this web site are for informational purposes only and not for the purpose of providing legal advice. Most of the information you find here is easily available on the internet. You should contact your attorney to obtain advice with respect to any particular issue or problem. The opinions expressed at or through this site are the opinions of the individual author and may not reflect the opinions of the firm or any individual attorney. Please Read our Privacy Policy and Legal Disclaimer Here.

Menace: I should have put my place up for sale about 3 years ago. It took til a major repair/replacement occurred for me to realize I can't afford to stay. I guess because I had a job briefly and it didn't work out, I had high hopes of finding at least part time. In the meantime my skills become even more outdated and more competition came along (ie others - healthier and no time gap - than I lost jobs).

Oh I forgot, I also had sick parent that distracted from the timing of selling. Another parent is ailing so I really really want to get nearer to help!!!I found people with children get more opportunities for assistance (and acceptable excuses for job gap).

How do I find this help for the disabled in my area? I'm just above "poverty" by about 200.00 or 300.00 and I'm finding I don't qualify for anything. (the other hindrence is my IRA monies).
I can't find someone to tell if me my IRA money can be saved for, well, retirement age. (IE I'm wondering if foreclosure will put those monies at legal seizure.)

Told my refi loan is Fannie Mae backed but I don't know if they (or bank servicer) will legally go after the IRA monies.

I just can't believe the housing market!!! I purchased back in 1996 and refi'd for only the balance due! My current listing price is a few thousand BELOW what I paid in 1996.

HOw does a person pass the apartment application when they have name on a home??? Thanks for any advice!

You need to look for social services in the gov section of the phone book, either city state, county, or federal. Your IRA shold be exempt in a bankruptcy, and that would also wipe out any chance of them coming after yo for any deficit from a short sale or foreclosure. If you are disabled, and get housing assistance, landlords will overlook your past financial history if you can show a steady income. There are some very nice apartment complexes I have visited built just for disabled with ages from 18-100 living there. The rent is subsidized, and you pay according to your income. If you are above poverty line, you pay more. But you need to find it yourself, or find an agency in the gov who can help you. You may be able to find a place where both you and your parent can live.

Best Regards,

Moe
Founder
LoanSafe.org - America's #1 Mortgage Forum
1-800-779-4547

DISCLAIMER: The comments by me and the materials available at this web site are for informational purposes only and not for the purpose of providing legal advice. Most of the information you find here is easily available on the internet. You should contact your attorney to obtain advice with respect to any particular issue or problem. The opinions expressed at or through this site are the opinions of the individual author and may not reflect the opinions of the firm or any individual attorney. Please Read our Privacy Policy and Legal Disclaimer Here.

Thank you for your very frank post. Not really sure if I can file bankruptcy given the amount of money I have in savings. But I think its worth looking into and having a consultation with an attorney. Unfortunately, Chase knows about the savings account (it is with a different bank). The mod application asked for that info and I thought it would be fraudulant to leave it out. It also was part of the info requested by NACA when I was trying to get their help. Maybe an attorney can tell me if there is a way to protect that money.

Does anyone know a good BK attorney in Orange county, CA?

Person2person:

Standard Medicare part B does not cover medication, unless something has changed due to the new healthcare laws. In any case that has not gone into affect for 2010. Medigap policies do not provide dental or vision coverage. Now, there are some Medicare Advantage plans that include dental and vision. These are typically HMO type plans where you have to see only the doctors within the plan. If you are currently receiving Medicare you can look in the Mediacre & you 2010 handbook that should have received. Your best bet is to go to the Medicare.gov site to learn about coverage and find out what is available in your area.

Menace: I don't think I"m a candidate for BK because I'm just starting my financial decent. I ran across someone who filed BK for other personal short falls of life. That person said to avoid it if possible. (sounds like they take away all your credit cards). Credit cards are my survival, but I don't intend to rack up my credit line for an inevitable BK. Trying to be a pro-active person here.

Section 8 housing vouchers are not accepting anymore on the wait list and I'm told the wait list is 2 years. (strangely I found out a pregnant teenager was able to get into housing within a shorter amount of time.) Granted she was lower income than myself, but something seems wrong with this idea. The complex she went to is only a 2bedroom complex so as a single person I would not qualify for their units.
My parent does not want to livein attached housing. I guess is ok, she smokes and I do not.
Additionally I know I need to move, this 43yr old place is not getting any younger! LOL ie can't afford it any more.
Can BK be filed if served with a legal suit?

Plantgeek: I used to have separate plan for drugs, dental, eye, and hearing. Soemthing changed because the deluxe rider is now only dental, eye, and hearing. I was told meds are on some other part I have (I think I'm I'm on part A and part B... is there a part D?).

I dropped deluxe rider (39/mo) to go get a storage locker to "declutter" my home. ughhh

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"Hello Moe, I just wanted to tell you, your website has saved my life (literally), I stumbled on your site in the middle of losing my home, I was able to network with people going through the same thing as I am. I didn't feel alone anymore, I have tried to give back and counsel those that haven't walked in my shoes yet. We hear so much about what is wrong with America, I just wanted you to know, you are whats "right" with America."